More Time to Buy in Italy, but Is That a Good Thing?

ELISABETTA POVOLEDO

Published: Friday, January 6, 2012 at 6:04 p.m.

Last Modified: Friday, January 6, 2012 at 6:04 p.m.

ROME — The first days of the new year have heralded a subtle revolution in Italy: the deregulation of operating hours for commercial venues like shops, bars and restaurants. And as revolutions tend to go, the measure has aroused praise in some corners and howls of protest in others.

Introduced in December as part of Prime Minister Mario Monti’s crisis-averting package, known as Save Italy, the measure permits shopkeepers everywhere to set their own hours and sharply reduces the norms that once regulated entrepreneurs trying to set up shop.

Although many consumers cheered, thrilled at the prospect of buying milk, bread or whatever after hours, small-enterprise associations — as well as number of regional government leaders — have denounced the new rules, calling them the death knell for mom-and-pop stores already struggling in Italy’s recessionary economy.

“People don’t buy in a moment of recession. If your buying power is limited, that isn’t going to change if a store stays open later,” said Valter Giammaria, president of the Rome chapter of Confesercenti, an organization for small and midsize businesses. His organization, he said, is considering shutting down stores in protest.

Mr. Giammaria said that small retailers in Italy were already being squeezed by competition with supermarkets, not to mention the slumping economy, and that in Rome alone 10,000 small shops had closed in the past three years, putting about 35,000 people out of work.

“The government has to rethink this whole thing. Otherwise it is only going to help large chain stores,” he said. “We’re on the side of small retailers.”

By that he means people like Angelo Salis, who operates a tiny bar in central Rome with his grown children and fears having to work longer hours — and Sundays — to stay in the game. “It’s fine if you own a large business, with lots of employees, but when it’s all in the family, I just don’t know,” Mr. Salis said, shaking his head.

Local residents’ groups are also on the warpath, fearful that giving bars carte blanche will make for sleepless nights.

Mr. Monti’s fledgling government has earmarked several ways in which to encourage growth in the Italian economy, which has been at a near standstill for the past decade. These include opening up closed occupations and measures to promote competition.

But judging by the protests against deregulation of business hours these days and the failed attempts last month to loosen up access to professions like taxi operators and pharmacists, Mr. Monti is facing an uphill battle.

Presidents of several Italian regions, which have traditionally overseen laws regulating some aspects of retail commerce, complain that the legislation is encroaching on their territory and have pledged to fight the changes in court. “Consumerism is not the right response to the crisis,” Enrico Rossi, president of the Tuscany region, told ANSA, a news agency. “It is an insult to our cultural identity, out traditions and our history.”

“We expect the church will make its voice known,” he added. The Vatican has so far kept quiet on the issue.

Some economists who study the retail sector acknowledge that keeping stores open longer is unlikely to increase spending, especially at a time when Italians are paying higher taxes and tightening their belts. But the effort to encourage competition is a welcome signal in a country with a corporate mentality that dates to the guilds of the Middle Ages and is averse to change.

“Economically, this won’t change anything,” predicted Roberto Ravazzoni at the Center for Research on Marketing and Services at Bocconi University in Milan. What counts is the spirit of the reform, he said, “because it is moving towards greater competition. The government’s just started with something easy.”

The issue has “made a lot of noise,” he added, “because it touches on so many aspects of society, like work, labor, family, as well as religion. It’s way beyond economics.” Still, though the economic impact might be limited, the social consequences will not be, Mr. Ravazzoni predicted, “giving options to people crushed by time.”

As salaries are unlikely to grow in the current climate, “giving them the option of when to buy, we can at least simplify the life of consumers,” he said.

The new opening hours could also be a challenge to entrepreneurial creativity, which is also expected to benefit from the loosening of regulations in opening a business. Mr. Ravazzoni said the development of block or neighborhood associations to create a nucleus of commercial activity had been successful in other countries.

Many retailers complain that their sector has been unfairly singled out. Giuseppe Roscioli, president of the Rome chapter of Confcommercio, another retailers’ association fighting the new hours, said that opening up competition “might not be so bad,” but, he added, “it should apply to everything,” including taxis and pharmacies.

Many people agree and are urging the government to open other protected sectors, like banking and insurance, as well as public utilities and gasoline stations. “That’s where Italy can really recover money and efficiency and offer lower prices to consumers,” Mr. Ravazzoni said.

There is no Europe-wide legislation regulating commerce, and opening hours can vary vastly among countries and among cities within those countries. According to RegioData, a research institute in Vienna, Germany and Austria are among the most regulated countries in terms of opening hours, while things are looser in France, Spain and Britain.

In Italy, state, regional and municipal legislation have coexisted for decades, and the current changes further muddle the issue. “It is a bit perplexing to have regional laws that go against federal legislation,” said Davide Bordoni, municipal counselor for commerce in Rome, one of the first cities to adhere to the new law. “Thirty percent of Rome residents live off commerce, so we didn’t want to be unprepared,” he said. Like other tourist cities in Italy, Rome already enjoyed more flexible hours under a previous law.

Regional governments have 90 days to adopt the national legislation.

Some retailers are skeptical about whether the new regulations will make much difference. “Rome isn’t New York City,” said Marina Moltedo, who works at Edo City, a clothing shop in Rome founded by the designer Alessandra Giannetti. “Italians don’t have the right mentality” to shop after hours.

Ms. Moltedo said that on the few occasions when City Hall permitted stores to stay open late at night, people browsed more than bought.

“If you’re going to stay open just to be a museum, then why not just open up galleries instead,” she said.

But amid all the grumbling, consumer groups have welcomed the change. “A more open market is good for consumers, offering a wider variety of products at lower prices,” said Carlo Pileri, the president of Adoc, an Italian consumers’ rights group. “Italian commerce has too long been run by a lobby averse to modernization.” And in any case, the new rules are an option, “not an obligation,” he said.

After dismal pre-Christmas activity, anticipation was high for Italy’s traditional winter sale period, which started Thursday. Whether the new hours will make a difference remains to be seen, but some merchants were optimistic.

“We’re in the center of Rome surrounded by bars,” and business has been good said Noemi Verzilli, a salesclerk at Taba, an ethnic clothing and knickknack store in Rome’s Campo de’ Fiori that had taken advantage of past legislation to stretch opening hours. “We’re so central, it would be stupid to stay closed.”

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